May replace Jim Keyes by year's end

Blockbuster has hired executive search firm Korn/Ferry to look for candidates who could run the struggling rental company once it emerges from Chapter 11 bankruptcy and push it further into digital businesses, the Journal said.

Keyes, a former 7-Eleven CEO, has led Blockbuster since 2007, and the company's board this summer extended his contract by a year with the understanding that he will see through a debt restructuring and may then leave.

According to the Journal, Keyes also remains a candidate to continue leading the company as the executive search is in its earliest stages, but some creditors have been pushing for new blood.

The paper said that Blockbuster's senior bondholders, including billionaire investor Carl Icahn, must approve the company's CEO choice by Dec. 31 under a restructuring deal the two sides negotiated before the company entered bankruptcy protection last month.